Business & Finance

ByCompiled from wire service reports by Robert Kilborn and Ross AtkinAugust 26, 2005

Johnson Controls, the world's largest maker of automotive seating, agreed to buy York International Corp., a manufacturer of heating, air conditioning, and ventilation systems, in a $3.2 billion deal that includes assuming $800 million in debt. The acquisition is expected to make Johnson Controls, which also manufactures building controls, the largest supplier to the building services market. Johnson Controls is based in Milwaukee; York in York, Pa.

Diageo PLC, the world's No. 1 marketer of alcoholic beverages, will sell all 25.1 million of its shares in cereal industry giant General Mills to Lehman Brothers for about $1.3 billion, the parties announced. Diageo wants to concentrate on its core liquor business. It had been the largest shareholder in General Mills, which is best known for its Cheerios brand.

The final vote needed to pave the way for privatizing Telstra, Australia's government-owned communications company, fell into place Thursday, bringing the sale a vital step closer to reality next year. Sen. Barnaby Jones, from the ruling National Party, had threatened to vote "no" on privatization but agreed to drop his opposition after extracting from the government billions of dollars worth of improvements to rural communications for his constituents. At about $23 billion, the sell-off of Telstra would be the world's largest, the Financial Times reported.

GE Capital Corp. confirmed reports that it will pay $1.55 billion for a 25.5 percent stake in Turkey's Garanti Bank. The deal wipes out half of Garanti's majority ownership by the Dogus Group, a private Turkish conglomerate with interests in financial services, construction, food processing, and auto sales. GE Capital is the consumer financing arm of General Electric.

Another 3,600 layoffs were announced by papermaking and personal-hygiene products giant Svenska Cellulosa of Sweden as part of a plan to lower operating costs by $197 million a year. The company also cut 1,200 jobs last year.

Lanxess, the chemical company spun off earlier this year by Bayer AG, said it will close unproductive plants and lay off 450 employees in a bid to become more competitive with Dow of the US and German rival BASF.